Daily ETF Watch: Schwab Adds To OneSource

September 19, 2014

More ETF providers join Charles Schwab's commission-free trading program.


Charles Schwab has said that it is widening the scope of its Schwab ETF OneSource program, which allows investors using through Schwab to execute trades commission-free for selected ETFs. The funds are also free of redemption fees and enrollment requirements, Schwab noted in a press release.

The program originally launched in February of last year and covered all of the Schwab ETFs as well as 90 funds from five other ETF providers. The original firms—in addition to Schwab—to join the OneSource platform were ETF Securities, Guggenheim Investments, Invesco PowerShares, State Street and United States Commodity Funds.

The expansion brings the total funds in the OneSource program to 182, and the number of participating firms to 13. The seven newcomers include ALPS, Direxion Investments, Global X Funds, IndexIQ, Pimco, ProShares and WisdomTree.

Notably absent are BlackRock’s iShares and Vanguard: iShares has an alliance with Fidelity in which 70 iShares ETFs and Fidelity’s own ETFs can be traded commission free by Fidelity customers, and Vanguard allows its customers to trade all Vanguard ETFs for free.

Schwab said in the press release that OneSource has $31 billion in assets under management and that its nearly $6 billion in inflows so far this year constituted about 45 percent of Schwab’s total ETF flows. It also pointed out that its 2014 ETF Investor Study found that 85 percent of participants place importance on the ability to trade ETFs without being charged commission fees.

SSgA Expands "Quality Mix" Lineup

State Street Global Advisors on Thursday launched three new single-country multifactor ETFs, the latest additions to its growing lineup of so-called Quality Mix funds that build on MSCI indexes.

The new SPDR ETFs track indexes from MSCI that combine the value, minimum volatility and quality factors. The new funds, which each come with an annual expense ratio of 40 basis points, or $40 per $10,000 invested, are as follows:

  • SPDR MSCI Mexico Quality Mix ETF (QMEX)
  • SPDR MSCI South Korea Quality Mix ETF (QKOR)
  • SPDR MSCI Taiwan Quality Mix ETF (QTWN)

All three countries are classified as emerging markets by MSCI.

The three newcomers join nine other “Quality Mix” SPDRs that SSgA has rolled out over the past few months. The first of these funds was rolled out in June. While SSgA is arguably something of a latecomer to the “smart beta” trend that has been embraced by much of the ETF industry, this lineup of Quality Mix funds is close to what might be characterized as cutting edge.

The first nine Quality Mix funds rolled out in June include three regional and six single-country funds, each with an expense ratio of 0.30 percent, or $30 for each $10,000 invested. They are:

 

 

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